Results Preview: Information Technology
- 2% - 3% sequential volume growth expected for top tier companies
- Margins expected to be almost flat
- Aggregate PAT almost flat
- We will watch out for :
a) The guidance from Infosys, if it gives an annual guidance.
b) Comments by company managements on budget finalization, spending patterns and order-booking trends,
c) Pricing declines, if any and comments on the same,
d) Strength in any of the verticals / services
We believe that, while the economies of USA and EU may take long to improve, the stimulus measures taken by them have eased concerns of catastrophic defaults / bankruptcies and helped them stabilise. There has likely been some improvement in velocity of decision making and discretionary budgets are also getting released, we understand. This may prevent demand from falling in the foreseeable future. Also, there is reportedly a strong demand for H1-B visas. We maintain our constructive view on the medium-to-long term prospects of the sector on expectations of improving demand over this period.
b) Comments by company managements on budget finalization, spending patterns and order-booking trends,
c) Pricing declines, if any and comments on the same,
d) Strength in any of the verticals / services
We believe that, while the economies of USA and EU may take long to improve, the stimulus measures taken by them have eased concerns of catastrophic defaults / bankruptcies and helped them stabilise. There has likely been some improvement in velocity of decision making and discretionary budgets are also getting released, we understand. This may prevent demand from falling in the foreseeable future. Also, there is reportedly a strong demand for H1-B visas. We maintain our constructive view on the medium-to-long term prospects of the sector on expectations of improving demand over this period.
Information Technology Results Preview from Mr. Dipen Shah, Head- Private Client Group Research, Kotak Securities:
